This form of money grabbing exercise continues with Windows 7. Not contended with this, Microsoft actually turns up the confusion one more notch by introducing Windows Virtual PC as oppose to Virtual PC 2007 SP1.

Windows Virtual PC works fine with VM created in VPC2007. But one thing to remember, you cannot run Windows Virtual PC together with VPC2007sp1 on the same Windows.

When you install VPC200SP1 (just make sure Windows Virtual PC is uninstalled - go to 'Programs and Features' and then 'Turn Windows features on or off') on Windows 7 Home Edition, Windows will warn you that the program is not supported on this edition of Windows. Just ignore this as it works fine. It is Microsoft's way of tricking you to buy a more expensive edition. Read on for more virtual machines that do not practice this kind of scare tactic.

While running Windows Virtual PC, drag-drop from Host OS to Guest OS or vice versa does not seem to be working while VPC2007SP1 handles this operation without trouble. If you like the drag-drop feature, just use VPC2007SP1, which incidentally supports wider guest OS.

When running up the VPC2007SP1 console, it will display this lame warning message box:

Just ignore this.

If you are concerned by this, check out this comprehensive review of other Virtual Machines available that are not concerned with which edition of your Windows 7 or Vista you are running on.

It is actually better to run non-Microsoft Virtual Machine because in this way you are guarantee a uninterrupted migration path to non-Microsoft Host OS machine. It is also interesting to note that VirtualBox can run 'XP Mode' VM.

After exploring these confusing situations, I have settled on using VM Player for serious stuff and to benefit from a much wider support of guest OS, leaving VPC2007SP1 to deal with my experimental VPC VM that I have accumulated.